Obama budget to adjust health insurance 'Cadillac tax'

WASHINGTON (Reuters) -- President Barack Obama will propose tailoring the controversial "Cadillac tax" on expensive private health insurance plans to reflect regional differences when he releases his 2017 budget plan next week, a senior White House adviser said in an article released on Wednesday.

Obama's proposal would reduce the bite of the unpopular tax by raising the threshold where it takes effect in areas where healthcare is particularly expensive, according to the article in the New England Journal of Medicine co-written by Jason Furman, chairman of the White House Council of Economic Advisers.

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Obama budget to adjust health insurance 'Cadillac tax'

White House photographer Pete Souza took this photo of President-elect Barack Obama moments before Obama took the oath of office. (Photo by Pete Souza/The White House)

President Obama and first lady Michelle Obama shared a moment at the Inaugural Ball on January 20, 2009. (Photo by Pete Souza/The White House)

The next day, Obama entered the Oval Office to begin his first full day as America's 44th president. (Photo by Pete Souza/The White House)

Obama reads a letter that former President George W. Bush left for him in the Oval Office's resolute desk. Leaving a letter for the incoming president has become a White House tradition. (Photo by Pete Souza/The White House)

The Obamas posed for their first holiday portrait in front of the official White House Christmas tree. (Photo by Pete Souza/The White House)

At the beginning of the new year, White House photographer Pete Souza took this photo of Obama meeting with members of his cabinet. The president's chair is marked with a plaque engraved with his inauguration date. (Photo by Pete Souza/The White House)

The Obamas danced during the Governors' Ball held in the East Room of the White House. (Photo by Pete Souza/The White House)

Obama reads some documents while waiting for Marine One at the Westchester County Airport in New York. (Photo by Pete Souza/The White House)

Obama speaks with a congressman about the healthcare-reform bill. "In those final days before the vote, the President made hundreds of calls," wrote White House photographer Pete Souza. (Photo by Pete Souza/The White House)

Alongside White House staff and Vice President Joe Biden, Obama clapped while watching the historic House vote to pass the Affordable Care Act. (Photo by Pete Souza/The White House)

Obama boarded Air Force One while the sun set at Miami International Airport. (Photo by Pete Souza/The White House)

The Obamas pretended to sing with an a capella group after a holiday tour of the White House. (Photo by Pete Souza/The White House)

"A lighter moment during a meeting in the Situation Room of the White House," Souza wrote. (Photo by Pete Souza/The White House)

Obama shook hands with US soldiers at Bagram Airfield after an all-night, unannounced flight to Afghanistan in December 2010. (Photo by Pete Souza/The White House)

The Obamas stared at Rio de Janeiro's famous Christ the Redeemer statue while visiting Brazil in March 2011. (Photo by Pete Souza/The White House)

Obama saluted a Marine while walking toward Marine One helicopter on the South Lawn of the White House. (Photo by Pete Souza/The White House)

Taken on May 1, 2011, from the White House Situation Room, Obama's national-security team monitored the real-time mission against Osama bin Laden. Souza took approximately 100 photographs during this confidential meeting. (Photo by Pete Souza/The White House)

"The president was ready to announce the news about the mission against Osama bin Laden and was putting the finishing touches on his statement in the Outer Oval Office. As he did so, the networks broke in with bulletins confirming that bin Laden had been killed and a photograph of him appeared on the television screen in the background near the Vice President and Press Secretary Jay Carney," Souza wrote. (Photo by Pete Souza/The White House)

"One of the most memorable moments of the year was when the president hugged Rep. Gabrielle Giffords as he walked onto the floor of the House Chamber at the US Capitol to deliver his annual State of the Union address," Souza wrote in January 2012. Giffords was shot in a 2011 mass shooting in Arizona. (Photo by Pete Souza/The White House)

"The President hugs the first lady after she had introduced him at a campaign event in Davenport, Iowa. The campaign tweeted a similar photo from the campaign photographer on election night and a lot of people thought it was taken on election day," Souza wrote. When the campaign tweeted it on election night, it became the most retweeted photo of all time. (Photo by Pete Souza/The White House)

Obama kissed the first lady for the "kiss cam" during the US men's Olympic basketball team's game against Brazil in Washington, D.C. (Photo by Pete Souza/The White House)

Obama sang "Happy Birthday" to Michelle in the Blue Room of the White House in 2013. Her new hairstyle attracted a lot of attention. (Photo by Pete Souza/The White House)

In this photo, Obama sits in front of cameras taking images that will later make a 3D portrait for the Smithsonian Institution. (Photo by Pete Souza/The White House)

"We were at the NATO Summit in Wales when someone mentioned to the President that Stonehenge wasn't that far away. 'Let's go,' he said. So when the Summit ended, we took a slight detour on the way back to Air Force One," Souza wrote in September 2014. (Photo by Pete Souza/The White House)

Obama laughed as he and Michelle recorded a holiday video message in the Map Room of the White House. (Photo by Pete Souza/The White House)

This March 2015 photo shows Obama delivering remarks during an event to commemorate the 50th Anniversary of Bloody Sunday and the Selma to Montgomery civil-rights marches. (Photo by Pete Souza/The White House)

Obama shook hands with President Raúl Castro of Cuba during the Summit of the Americas on April 11, 2015. The US and Cuba have moved toward a historic thaw in relations over the past year. (Photo by Pete Souza/The White House)

Vice President Joe Biden announced he would not seek the 2016 Democratic presidential nomination in October, as Obama stood by his side during an appearance in the Rose Garden of the White House. (AP Photo/Jacquelyn Martin)

In this November 2015 photo, Obama collects a folder holding the bipartisan Budget Act of 2015 after signing it into law in the Oval Office. (AP Photo/Andrew Harnik)

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The tax on high-cost employer-based healthcare plans, passed as part of the president's 2010 Affordable Care Act and set to take effect in 2018, has generated growing opposition in part because labor unions say it could encourage employers to cut back on health insurance plans for workers.

The tax was expected to raise some $87 billion a year to help pay for the reform generally known as Obamacare.

White House officials did not immediately respond to a request for comment.